Salsa Maker Herdez Rallies on Citigroup’s Buy: Mexico City Mover

By Jonathan Levin -
Aug 20, 2013

Grupo Herdez SAB (HERDEZ*), Mexico’s biggest
producer of canned foods, rose the most in two weeks after
Citigroup Inc. recommended buying its stock.

Shares of the company, known for its namesake salsas,
climbed 3.2 percent to 44.96 pesos at 2:39 p.m. in Mexico City,
the biggest gain on a closing basis since Aug. 7. The IRT Small
Capitalization index of 20 Mexican companies, including Herdez,
rose 0.9 percent, while the benchmark IPC rose 0.6 percent.

Herdez’s purchase this year of a controlling stake in
frozen-yogurt distributor Grupo Nutrisa SAB has proven to be
profitable, Citigroup analysts Julio R. Zamora and Marcela Munoz
wrote in a research note to clients published yesterday. The
dessert division is now worth 10.4 billion pesos ($801 million),
more than three times the 2.97 billion pesos Herdez paid in May,
according to the analysts, who raised their recommendation to
buy from neutral.